Five Things You Need to Know for Thursday

What you need to know (and what it means).

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Five things you need to know to stay ahead of the pack on Wall Street.

1. Boomerdang! Effect

A new Federal Reserve study suggests the U.S. economy will have to decelerate much more over the next decade than most now expect, according to Bloomberg.

The study, set to be be published in July, finds that the retirement of Baby Boomers will force far-reaching adjustments in the way the economy works.

According to the study, forecasts for everything from growth and employment to corporate profits and interest rates will have to be recast.

The study projects what the authors call a "conservative'" 3 percentage-point decline over the next 10 years in the labor force participation rate - the percentage of people who are either working or looking for work.

Social Security, on the other hand, forecasts a more modest participation rate decrease of 1.1 percentage points in the next 10 years.

Labor tightening due to a slowdown in workforce growth will create a loss of .3% from last decade's average GDP growth of 3.3%*, the study says.

According to Bloomberg a .3% difference in the $12 trillion U.S. economy comes to $360 billion over a decade.

To simplify this figure and put it in perspective, suppose you make $120,000 a year and carry the bulk of it around in your pocket in loose change. (Look at the deep pockets on you, big spender!) Imagine that when you go home each night and faceplant after work, some of your change spills out and falls deep into the couch, a dollar in change to be exact. This happens almost every day for 10 years. Over a 10 year period, you will have lost about $3,600 in your couch.

Translated into "economics," this means the faceplanting U.S. economy is going to be losing about $100,000,000 each day in the couch!

On the bright side, some unsuspecting re-upholsterer is going to get very, very lucky.

* (Past performance does not predict future results.)

2. Still More Boomerdang! Effect

Proposed changes to the way US companies account for pension obligations could knock an average of 8 percent off the net worth of 100 of America's biggest companies, according to a new study.

While Congress is considering rule changes designed to make companies more responsible for the pension promises, a new study by an actuarial firm calculates that companies' pension plans are underfunded by nearly $100,000,000,000.

The underfunding comes despite better-than-anticipated investment gains the past three years.

Companies earned an average return of 11.3 percent last year against anticipated returns of 8.5 percent.

According to the study, just two companies - Berkshire Hathaway and the FPL Group, would see shareholders' equity increase under the new rules based on 2005 figures, the Financial Times said.

Although the change to pension reporting would not affect corporate earnings, shares of the most exposed companies are already underperforming, according to Lehman Brothers.

3."I don't even need a new car. I just wanted the rebate!"

Carlos Ghosn, who runs both French automaker Renault and its Japanese affiliate, Nissan, urged fellow auto executives yesterday to wean themselves from costly incentives, which he said had become "an insidious, confusing carousel" on which the companies could not stop spinning, the New York Times reported.

Mr. Ghosn's plea came at the New York International Auto Show.

In March, the auto industry spent an average of $3,200 a vehicle on rebates, discounted lease deals and financing plans.

Mr. Ghosn estimates carmakers are spending $60 billion a year on incentives.

"Such rebates and other plans are depressing the resale value of automakers' products, ruining their brand images and eroding the attraction that automobiles have traditionally had for buyers, Mr. Ghosn said, according to the NYT.

Mr. Ghosn estimates carmakers are spending $60 billion a year on incentives - enough to develop 120 new vehicles, at a cost of $500 million apiece.

You are probably by now wondering how to pronounce Ghosn.

It is correctly pronounced: Gohn.

You may be also wondering whether his company, Renault, is pronounced "Ruh-no" or "Re-nought".

When the car was first imported to the United States in the 50s, the Anglicized "Re-nought" pronunciation was used so Americans would not be frightened.

Today the company is correctly pronounced, "Re-noh" because Americans are not as afraid of French things as they were in the 50s.

4.Iceland number one in broadband,icy land.

Iceland is most web-savvy country, with a study showing it has the highest concentration of broadband users, according to the BBC.

The Organization for Economic Cooperation and Development found that Iceland has a concentration of more than 26% of their net subscribers using broadband service, highest per capita.

The US still has the most broadband users, with more than 49 million, but on a per capita basis only about 16% are broadband users.

South Korea is second in broadband per capita penetration with 25.4%.

More than six out of every 10 broadband households in the world get their broadband over Digital Subscriber Line (DSL).

Who cares about broadband and DSL growth?

Copper investors might.

DSL uses copper phone wires.

5. Let me check my Calendoogle

Today Google is unveiling a new calendar service allowing users to track meetings, appointments and other items.

Bloggers have been speculating about Google's entry into the calendar space for more than a year.

Some believe Google's involvement could spur a flurry of Web calendar development.

The service initially will be integrated with Google's Gmail e-mail service.

Last October, Google and Sun Microsystems "agreed to explore opportunities to promote and enhance" various technologies, including OpenOffice.org, which is an open-source alternative to Microsoft Office.

An interesting feature of Google Calendar is its ability to understand language and to quickly create calendar entries.

Speaking of Google, ever wonder what a $120 billion dollar company looks like in its infancy? Here you go.

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